Money & Banking

In digital push, RBI nixes NEFT fee for SB a/c customers from Jan

Our Bureau Mumbai | Updated on November 08, 2019 Published on November 08, 2019

RBI has mandated banks not to charge savings bank account customers for online transactions done via the National Electronic Fund Transfer (NEFT) system.

There’s good news for customers in the New Year. As part of its agenda for furthering digital payments, the Reserve Bank of India has mandated banks not to charge savings bank account customers for online transactions done via the National Electronic Fund Transfer (NEFT) system.

This will come into effect from January 2020.

The RBI, in its second bi-monthly policy, this June, had announced that it has decided to do away with charges levied on transactions processed in the RTGS and NEFT systems in order to provide an impetus to digital funds movement.

It had not given a timeline at the time but had said banks would be required to pass on these benefits to their customers.

In a press release on Friday on deepening digital payments, the RBI said it also plans to operationalise the Acceptance Development Fund to increase acceptance infrastructure with effect from January 1, 2020.

Need for QR codes

It will constitute a committee to assess the need for plurality of QR codes, and merits of their co-existence or convergence from both systemic and consumer viewpoints.

The RBI said it will also permit all authorised payment systems and instruments (non-bank PPIs, cards and UPI) for linking with National Electronic Toll Collection (NETC) FASTags. “Going forward, this will facilitate the use of FASTags for parking, fuel, etc., payments in an interoperable environment,” it said.

It will also enable processing of e-mandates for transactions through UPI.

“In pursuance of its vision to promote digital payments, the Reserve Bank’s endeavour has been to establish state-of-the-art payment systems that are efficient, convenient, safe, secure and affordable,” it said, adding that the steps have been planned to further empower every citizen with an ‘Exceptional (e) Payment Experience’, and provide individuals access to a bouquet of options.

Rising transactions

Digital payments constituted a high 96 per cent of total non-cash retail payments between October 2018 and September 2019. During this, the NEFT and Unified Payments Interface (UPI) systems handled 252 crore and 874 crore transactions with year-on-year growth of 20 per cent and 263 per cent, respectively, the RBI noted.

This rapid growth in the payment systems has been facilitated by a series of measures taken by the central bank, it added.

Published on November 08, 2019
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